Budget FY’21-22: What does it mean for Indian steel industry?

Hon’ble Finance Minister of India, Nirmala Sitharaman today presented the Union Budget for the fiscal year 2021-22. Let’s take a look on the major highlights and announcements of the budget in relation to Indian iron and steel industry.

Budget FY’21-22 Highlights –

Infrastructure

• Expansion of the National Infrastructure Pipeline projects to 7,400 projects.
• By Mar’22, government would be awarding another 8,500 kms and complete an additional 11,000 kms of national highway corridors.
• An outlay of INR 1,18,101 lakh crores for Ministry of Road Transport and Highways, of which INR 1,08,230 crores is for capital, the highest ever.

Disinvestment

• Strategic disinvestment to be carried out for – BPCL, Air India, Shipping Corporation of India, Container Corporation of India, Neelachal Ispat Nigam limited among others would be completed in 2021-22.

Railways

• INR 1.10 lakh cr outlay for railways, of which INR 1.07 lakh cr is for capital expenditure.
• Aims at developing adequate rail infrastructure by 2030 under National Rail Plan.

Ports, Ships, Waterways

• Recycling of Ships Act, 2019 enacted and recycling capacity to be doubled by 2024.
• Subsidy support to promote flagging of merchant ships.
• PPP mode to be utilised for managing operational services of major ports.
• Around 90 ship recycling yards at Alang in Gujarat have already achieved HKC-compliant certificates. Efforts will be made to bring more ships to India from Europe and Japan. Recycling capacity of around 4.5 mn LDT will be doubled by 2024.

Scrapping Policy

• Voluntary Vehicle Scrappage Policy announced for private and commercial vehicles.
• Private vehicles older than 20 years and commercial vehicles older than 15 years to undergo fitness tests.
• Vehicle fitness tests to be conducted at automated fitness centers.

Duty changes

• Custom duty on steel imports (including Flat Products of iron or non-alloy steel and alloy steel) reduced to 7.5 %.
• Import duty on ferrous scrap import slashed to 0% from 2.5%.

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